[rileymat2]

Stock options are not adjusted for regular dividends, to the option holder these are absolutely not financially equivalent.

This is where the executive compensation conspiracies come in, buybacks are better in this case.

[blitzar]

Stock option pricing explicitly takes into account the expected dividend yield.

Option strike prices can be adjusted for one off events like stock splits / reverse splits, special dividends etc.

[rileymat2]

Yes, the expected dividends, however growth in stock prices are due to /unexpected/ risk adjusted growth. ISO options often have a 10 year period after vesting, it is unlikely to be predictable in pricing.

Also, the exercise amount has to be the current share price or higher or you pay gains on them.

Edit: You see the same thing with unvested RSU’s if the company does not do something extra but not required.

Edit2: The price you pay for the option on the open market accounts for it as best they can, but does not account for grants in ISO options and unvested RSU’s. Largely held by insiders. Hence the conspiracy theories.